MCI transplant said:
chisprings said:
I agree. The screwup being the purchase of TWA's assets to begin with. They should have just let TWA die on its own.
Southwest adds a handful of flights. Wow!
AA moves its assets out of a loss leading hub and focuses on more profitable routes - admirable.
😉 This is a tipical a.a. responce! Blame all your screw ups on the TWA purchase, and stick your head in the sand!!!!!!!! :down: Signed, another redheaded stepchild!
I find your responSe to my responSe tYpical of many hurt ex-TWA employees.
I didn't suggest in any way that the purchase of TWA's assets was the reason AA is losing money. It certainly didn't help AA's cost structure in the weakened operating environment. I think pre-TWA, many AA employees (esp. those who remember the 91-95 downturn) thought the company was expanding too quick and incurring a lot of debt for a major fleet renewal, fleet refurbishment and capital projects (MIA, JFK, LAX, DFW). TWA was just a nail in the coffin once the revenue bottom dropped out. It is clear that TWA with its lower operating costs could not even make any money in STL. AA has a higher cost structure and is generating less yield that TWA did due to the weak economy. STL was bleeding money and AA had to stop. Carty was too proud and egotistical to make the right - but hard - choices. He promised labor harmony in 1998 and failed. He erred in buying Reno Air and TWA. (Not knocking either carriers or their fine employees - they were simply strategic mistakes for AA) When I said AA should have let TWA die on its own - I meant it. TWA was a dying airline - the entire industry for many years knew that TWA was dying. TWA was not an acquisiton target because no one wanted to touch TWA debt or labor problems. Unfortunately, Carty thought he was getting something for nothing in TW's most desperate hours. Despite the advice of many - Carty went ahead with the deal. I only wish the synergy of a good economy and continued growth would have meant greater opporunity for all AMR employees (including ex-TW). Fate did not allow this. And as harsh as it may sound - I don't think AA employees from pre-TW should have to bear the brunt of hurt. It is only fair that TW employees who had weak prospects due to the failure of their legacy employer would have to bear the brunt of these hard times. Please do not forget that many AA employees have lost their jobs and suffered through pay cuts along with the 'red headed step children'. As much as I hate to see TWA gone, it may have been easier for all if TW employees had come to work in January of 2001 to find operations shut down (which is what was going to happen - trust me, TW officers were prepared to do this many weeks before Jan. 2001 but held out until the AA deal was finished) and move on with their life. They could have moved on months - if not years - earlier and would not be able to blame AA for their downfall. They also would not have been fed a false sense of hope or security by Carty.
Finally Arpey exits the bleeding STL market and allows AA to move assets to more profitable markets, end expensive operating leases and reduce fixed costs. Why didn't AA have a slow pull down and exit after the holiday season? Well, the benefit of additional holiday revenue (traditionally low-yield VFR traffic) was worth less than moving the aircraft to higher-yielding markets, laying off employees, reducing fixed costs at STL and terminating operating leases. The benefits of staying in STL a few months more through the busy holidays were less than shutting down Nov. 1st.
Southwest adding a few flights a day to the STL market is not evidence of a mistake by AA. In fact, Southwest complains about the low yield in STL as well and will operate fewer flights per day next year at Lambert than they currently do. They may be adding FLL and LAX, but they already have exited many other markets from STL. Also, AA moving capacity away from STL to markets that are more profitable for AA, does not mean that STL does not have the demand for other carriers. The market may be there for other carriers who can benefit more from STL than AA can.
Despite a large corportate base, STL just does not produce the yield airlines need to invest in a large hub operation. In addition STL offers poor terminal facilities and a poor runway configuration. Major upgrades are needed for that airport. In addition, the advent of regional jet point to point flying means that hubs are no longer dominant and weaker hubs like STL will disappear or turn into RJ centers.
AA will maintain an operation in STL that benefits its entire network. I can only hope that the improvements AA is making to the airline's balance sheet and network now (even if at the expense of STL) will secure the airline's future and ability to compete and expand moving forward. This is the best opportunity for all AMR employees active and furloughed, nAAtive and TWA.
